Global oil prices continue uptrend with refined petroleum closing in on US$ 80 a barrel

Global crude oil prices are further advancing in the hope of robust global recovery while the refined petroleum products are closing in on US$ 80 a barrel in the global futures exchanges, reaching multi year highs.

As investors increasingly bet on oil above US$ 100 a barrel by the end of next year, traders have begun to enter into options contracts, which allow the holders to buy or sell an asset at a specified price in the future as a way to hedge the risk from rising prices. 

Crude oil was trading above US$ 73.09 a barrel yesterday at the Brent futures exchange at Singapore, while refined petrol was trading at US$ 79.50 a barrel on June 14. 

Refined diesel was trading at US$ 76.72 a barrel while kerosene was trading at US$ 76.39 a barrel as the rally continues on the recovery of major global economies and air travel.

Oil prices hit a pandemic high on Monday while the prices at US West Texas Intermediate—the US benchmark for crude oil—reached US$ 71.78 a barrel, the highest in more than two and a half years, before closing slightly lower at US$ 70.88 barrel. 

Sri Lanka spends more on refined petroleum compared crude oil, according to the Central Bank data. Out of the US$ 347.2 million spent on oil imports in March 2021, US$ 310.5 million was spent on refined petroleum, up over 100 percent from the same month in 2020.

Sri Lanka last week announced significant hikes in fuel prices at the pump.